Financial Performance - The company's revenue for the first half of 2020 was RMB 235.61 million, a decrease of 39.69% compared to RMB 390.69 million in the same period last year[5]. - Net profit attributable to shareholders for the same period was RMB 29.08 million, down 68.30% from RMB 91.72 million year-on-year[5]. - The net cash flow from operating activities decreased by 39.58% to RMB 60.82 million, compared to RMB 100.66 million in the previous year[5]. - The basic earnings per share for the first half of 2020 was RMB 0.0310, a decrease of 70.00% from RMB 0.0994 in the same period last year[5]. - Operating revenue decreased by 39.69% to RMB 235.61 million compared to RMB 390.69 million in the same period last year[51]. - Net profit for the six months ended June 30, 2020, was RMB 29,364,848, down 65.5% from RMB 85,071,929 in the previous year[152]. - Total profit for the six months ended June 30, 2020, was RMB 27,996,722, a decline of 70.0% compared to RMB 93,411,845 in 2019[152]. - The total comprehensive income for the six months ended June 30, 2020, was RMB 29,416,219, compared to RMB 85,077,647 in 2019, reflecting a decrease of 65.4%[154]. Assets and Liabilities - Total assets increased by 53.53% to RMB 2.40 billion from RMB 1.56 billion at the end of the previous year[6]. - The total assets of the company reached RMB 2,402,467,436 as of June 30, 2020, compared to RMB 1,564,824,553 as of December 31, 2019, representing an increase of approximately 53.5%[148]. - Total liabilities decreased to RMB 510,820,898 from RMB 600,234,806 in 2019, a reduction of about 14.9%[151]. - The company’s total equity increased significantly to RMB 2,021,847,891 from RMB 1,087,347,148, marking an increase of approximately 85.5%[151]. Research and Development - Research and development expenses accounted for 24.15% of operating revenue, an increase of 10.69 percentage points compared to 13.46% in the previous year[5]. - Total R&D investment for the period was CNY 56,903,236, accounting for 24.15% of operating revenue, with capitalized R&D investment making up 4.45%[31]. - The company has established several core technology platforms, including gene engineering, photodynamic therapy, and nanotechnology, to enhance its R&D capabilities and meet clinical needs[24]. - The company is focusing on expanding its drug development in oncology, dermatology, and autoimmune diseases, while also exploring molecular targeting and immunotherapy[43]. - The company is conducting Phase II clinical research on the use of Amikacin for treating HPV-related cervical precancerous lesions and Phase I trials for moderate to severe acne[27]. Market and Product Development - The decline in revenue was primarily due to the impact of the COVID-19 pandemic, which affected drug distribution and hospital patient visits[6]. - The company aims to become an innovator and leader in the biopharmaceutical industry by focusing on clinical treatment gaps and providing effective treatment solutions[9]. - The company's main products include Aira® for the treatment of genital warts, which has significantly reduced recurrence rates compared to traditional therapies and has been included in clinical treatment guidelines since 2013[10]. - The long-circulating liposomal doxorubicin injection, Liboduo®, launched in August 2009, offers improved efficacy and reduced side effects for cancer treatment, specifically for Kaposi's sarcoma, breast cancer, and ovarian cancer[11]. - The injectable Hemoporfin, Fumeida®, is the world's first photodynamic drug for the treatment of port-wine stains, demonstrating high cure rates and low recurrence compared to traditional laser treatments[12]. Financial Strategy and Investments - The company raised RMB 996 million from its initial public offering, significantly boosting cash flow from financing activities[53]. - Cash and cash equivalents increased by 212.49% to RMB 1.53 billion, primarily due to funds raised from the IPO[57]. - The company has invested CNY 1,274.79 million in the Heimbofen project in the U.S., which is in communication with the FDA for registration[32]. - The total investment in the ongoing biomedical innovation project is projected at CNY 24,000 million, with CNY 3,716.40 million already invested[33]. Compliance and Governance - The company appointed PwC Zhongtian as the auditor for the financial statements based on Chinese accounting standards, effective from February 24, 2020[106]. - The company has no significant litigation or arbitration matters during the reporting period[107]. - The company has maintained compliance with environmental regulations, with no violations reported during government inspections[115]. - The company will strictly adhere to the decision-making procedures of the board and shareholders' meetings regarding related party transactions[80]. Shareholder and Equity Information - The company reported a total of 1,043,000,000 shares outstanding after an increase of 120,000,000 shares[118]. - The proportion of restricted shares decreased from 63.17% to 58.67% following the issuance of new shares[118]. - The company distributed RMB 64,610,000 to shareholders during the six-month period, which impacted the retained earnings[163]. - The company has a total of 156,892,912 restricted shares released during the reporting period[123].

Financial Performance - The company reported a total revenue of RMB 1.2 billion for the first half of 2020, representing a year-on-year increase of 15%[1]. - The net profit for the same period was RMB 300 million, showing a growth of 20% compared to the previous year[1]. - The company's operating revenue for the first half of 2020 was ¥235,614,896, a decrease of 39.69% compared to ¥390,693,485 in the same period last year[23]. - The net profit attributable to shareholders for the first half of 2020 was ¥29,078,874, down 68.30% from ¥91,719,590 in the previous year[23]. - The net cash flow from operating activities decreased by 39.58% to ¥60,819,045, primarily due to a decline in operating revenue and slower accounts receivable collection during the pandemic[25]. - The company's net profit after deducting non-recurring gains and losses was ¥10,530,619, reflecting an 86.25% decrease from ¥76,608,030 in the same period last year[23]. - Revenue for the reporting period was CNY 235,614,896, a decrease of 39.69% compared to the previous year[92]. - The cost of sales decreased by 51.53% to CNY 17,970,463, resulting in a slight increase in overall gross margin[92]. Research and Development - The company is investing RMB 200 million in R&D for new technologies related to photodynamic therapy[1]. - The R&D expenditure as a percentage of operating revenue increased to 24.15%, up by 10.69 percentage points from 13.46% in the previous year[24]. - The company has invested a total of ¥56,903,236 in R&D during the reporting period, which accounts for 24.15% of its operating revenue[58]. - The company is focusing on drug development based on gene engineering, photodynamic technology, nanotechnology, and oral solid preparation technology, particularly in the fields of tumors, skin diseases, and autoimmune diseases[77]. - The company is advancing its research on antibody-drug conjugates (ADCs) as a key direction, with a proprietary platform based on topoisomerase DXd showing promising results in tumor treatment[80]. - The company has established a solid foundation for the industrialization of gene engineering technology drugs, with plans to enhance research on projects that have entered clinical stages[49]. Market Strategy and Expansion - The company plans to launch two new products in the second half of 2020, aiming to capture a larger market share in the biopharmaceutical sector[1]. - Future outlook includes a projected revenue growth of 10% for the full year 2020, with a focus on expanding into international markets[1]. - Market expansion strategies include partnerships with three new distributors in Southeast Asia[1]. - The company aims to conduct international registrations for its existing products to support its global expansion strategy[53]. Product Development - The flagship product, Aira®, is the world's first photodynamic drug for the treatment of genital warts, significantly reducing recurrence rates compared to traditional therapies[31]. - The long-circulating liposomal doxorubicin, Liboduo®, was launched in August 2009, offering improved efficacy and reduced side effects for cancer treatment[32]. - The company has developed a gene engineering technology platform, focusing on monoclonal antibodies and antibody-drug conjugates, with ongoing Phase I clinical trials for CD30-DM1 targeting triple-negative breast cancer and other tumors[49]. - The photodynamic therapy platform is at a world-leading level, with key products including Aira® for treating genital warts and Revmed® for treating capillary malformations, both of which have received regulatory approvals and are in commercialization[50][51]. Financial Position and Investments - The company has maintained a strong cash position with RMB 500 million in cash reserves as of June 30, 2020[1]. - The company received a substantial inflow of RMB 996 million from its initial public offering and overallotment in the first half of the year[96]. - As of June 30, 2020, cash and cash equivalents amounted to RMB 1,529,302,256, representing a 212.49% increase compared to the same period last year[99]. - Long-term equity investments increased by 78.31% to RMB 61,438,432, mainly due to additional investments in Baifu Changzhou[99]. Risks and Challenges - The management highlighted potential risks related to regulatory changes in the pharmaceutical industry[1]. - The company faces risks related to the single product variety and potential price reductions due to increased competition and regulatory changes[84][85]. - The company has faced challenges with long industrialization cycles and gaps in project timelines, prompting the establishment of the oral solid dosage technology platform[55]. Corporate Governance and Compliance - The company has established a commitment that no share transfers will occur within six months after the departure of any director or senior management[145]. - The company will ensure that the price of any share transfer will not be lower than the initial public offering price, with adjustments made for any corporate actions such as dividends or stock splits[139]. - The company has maintained a consistent environmental policy, adhering to national laws and regulations regarding emissions[165]. - The company conducted multiple inspections by government agencies regarding wastewater discharge, with no violations reported[165].

[Company Information](index=3&type=section&id=Company%20Information) The report provides essential company information including board members, auditors, and key financial institutions as of year-end 2019 - The report provides a list of board members, supervisory board members, and committee members as of the end of 2019, along with basic company information such as auditors, legal advisors, main banks, and share registrars[27](index=27&type=chunk)[28](index=28&type=chunk) [Five-Year Financial Summary](index=5&type=section&id=Five-Year%20Financial%20Summary) The company achieved robust growth in 2019, with revenue surpassing RMB 1 billion and net profit attributable to shareholders increasing by 103%, while adopting China Accounting Standards from 2019 and restating 2018 data 2018-2019 Key Performance Indicators (RMB thousand) | Indicator | 2019 | 2018 (Restated) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Revenue | 1,029,295 | 741,841 | +38.7% | | Profit before income tax | 246,312 | 93,890 | +162.3% | | Annual profit | 220,654 | 90,913 | +142.7% | | Annual profit attributable to company shareholders | 227,358 | 112,129 | +102.8% | | Basic earnings per share (RMB) | 0.2463 | 0.1215 | +102.7% | 2018-2019 Balance Sheet Summary (RMB thousand) | Indicator | December 31, 2019 | December 31, 2018 (Restated) | | :--- | :--- | :--- | | Total assets | 1,564,824 | 1,469,691 | | Total liabilities | (631,676) | (515,259) | | Equity attributable to company shareholders | 931,525 | 943,218 | - Starting from 2019, the company changed its overseas financial reporting standards from International Financial Reporting Standards to China Accounting Standards, and restated the 2018 consolidated financial statements, with no adjustments made to the 2015-2017 statements[33](index=33&type=chunk) [Chairman's Report](index=7&type=section&id=Chairman's%20Report) [Development Philosophy and Research Strategy](index=7&type=section&id=Development%20Philosophy%20and%20Research%20Strategy) The company prioritizes innovation, focusing on unmet clinical needs through four technology platforms, primarily in oncology, dermatology, and autoimmune diseases, achieving breakthroughs in ADC and advancing existing products - The company established Antibody-Drug Conjugates (ADC) as the primary R&D direction for its gene technology platform and achieved breakthroughs in the DXd ADC project, laying the foundation for subsequent development[38](index=38&type=chunk) - Photodynamic drugs have become the Group's most important product group, and the company plans to pursue international registration for already marketed drugs (e.g., Fumedai®), having initiated preliminary communication with the US FDA[40](index=40&type=chunk)[42](index=42&type=chunk) - The company is pursuing US registration for one of its core products, Lipusu® (Doxorubicin Hydrochloride Liposome), and has initiated domestic generic drug consistency evaluation studies[43](index=43&type=chunk)[44](index=44&type=chunk) As of End of 2019, Progress of Major Pipeline Drugs | Technology Platform | Project Name | Indication | Progress Achieved | | :--- | :--- | :--- | :--- | | Gene Technology | Anti-CD30 Antibody-Drug Conjugate | Oncology | Phase I Clinical Study | | | Anti-Trop2 Antibody-Drug Conjugate | Oncology | Preclinical Study | | | Anti-Her2 Antibody-Drug Conjugate | Oncology | Preclinical Study | | Photodynamic Technology | Hemoporfin | Port-wine Stain | Phase IV Clinical Study, US Registration Preparation | | | Aminolevulinic Acid Hydrochloride | HPV-infected Cervical Diseases | Phase II Clinical Study | | | Aminolevulinic Acid Hydrochloride | Acne | Phase I Clinical Study | | Nanotechnology | Doxorubicin Hydrochloride Liposome | Oncology | US Registration in Progress, Domestic Consistency Evaluation Preparation | | Oral Solid Preparation | Obeticholic Acid | Liver and Gallbladder Diseases | Clinical Consistency Evaluation and Registration | | | JAK1 Inhibitor | Autoimmune Diseases | Preclinical Study Completed, Clinical Trial Application Planned | [Operational Strategy and Business Review](index=13&type=section&id=Operational%20Strategy%20and%20Business%20Review) In 2019, product sales revenue grew by 37%, with core products Aile®, Lipusu®, and Fumedai® contributing 99% of total sales, as the company transformed into an R&D and industrialization-focused enterprise - In 2019, product sales revenue increased by **37%** year-on-year, with the three core products Aile®, Lipusu®, and Fumedai® collectively contributing **99%** of total sales revenue[48](index=48&type=chunk) 2019 Major Product Sales Revenue Growth | Product | 2019 Sales Revenue Year-on-Year Growth | | :--- | :--- | | Aile® | +17% | | Lipusu® | +68% | | Fumedai® | +37% | - The company effectively increased Lipusu®'s terminal sales and market share through cooperation with Shanghai Huizheng[50](index=50&type=chunk) - The company has successfully transformed from a purely R&D-focused entity to one that emphasizes both R&D and industrialization, forming a complete system encompassing R&D, manufacturing, and marketing[56](index=56&type=chunk) - As of the end of 2019, the company had cumulatively applied for **87** invention patents and obtained **48** authorizations, receiving a total of approximately **RMB 11.47 million** in government grants and awards during the year[58](index=58&type=chunk)[59](index=59&type=chunk) [Management Discussion and Analysis](index=18&type=section&id=Management%20Discussion%20and%20Analysis) [Financial Review and Accounting Standard Changes](index=18&type=section&id=Financial%20Review%20and%20Accounting%20Standard%20Changes) To align with A-share issuance, the company changed its overseas financial reporting standards to China Accounting Standards in 2019, restating 2018 data, primarily by amortizing a RMB 50 million compensation, which reduced 2018 restated net profit by RMB 38.85 million - The company changed its overseas financial reporting standards from International Financial Reporting Standards to China Accounting Standards to unify financial information disclosure across both locations[60](index=60&type=chunk) Impact of 2018 Accounting Method Change on Financial Data (RMB thousand) | Item | Before Adjustment | Adjustment Amount | After Adjustment | | :--- | :--- | :--- | :--- | | Annual profit | 129,766 | (38,852) | 90,913 | | Annual profit attributable to company shareholders | 150,982 | (38,852) | 112,129 | | Earnings per share (RMB) | 0.1636 | (0.0421) | 0.1215 | - The core reason for the accounting change was to amortize the **RMB 50 million** commercial compensation paid by Shanghai Huizheng over a 10-year promotion service period, instead of recognizing it as a one-time gain, to align with accounting treatments more commonly accepted by domestic listed companies[64](index=64&type=chunk)[65](index=65&type=chunk) [Operating Performance Analysis](index=21&type=section&id=Operating%20Performance%20Analysis) In 2019, operating revenue grew 39% to RMB 1.029 billion, driven by core products, with improved gross margin and a 143% surge in net profit to RMB 221 million, increasing the net profit margin to 21.44% 2019 Operating Performance Overview (RMB) | Indicator | 2019 | 2018 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Operating revenue | RMB 1.029 billion | RMB 742 million | +39% | | Operating cost | RMB 73.34 million | RMB 70.79 million | +3.6% | | Selling expenses | RMB 531 million | RMB 400 million | +33% | | Administrative expenses | RMB 54.93 million | RMB 83.57 million | -34% | | R&D expenses | RMB 128 million | RMB 114 million | +12% | | Net profit | RMB 221 million | RMB 90.91 million | +143% | | Net profit margin | 21.44% | 12.26% | +9.18pp | - Core products Aile® and Lipusu® contributed significantly to the Group's revenue, accounting for **45%** and **44%** of total revenue, respectively[67](index=67&type=chunk) - Product sales cost as a percentage of sales revenue decreased from **9%** to **7%**, primarily due to a decrease in Lipusu®'s unit cost, leading to a slight increase in overall gross margin[69](index=69&type=chunk) - Administrative expenses decreased by **34%**, mainly due to Dermedicine no longer being included in the scope of consolidation and the cessation of operations by Shanghai Baosu Pharmaceutical Technology Co, Ltd[70](index=70&type=chunk) [Significant Transactions and Investments](index=24&type=section&id=Significant%20Transactions%20and%20Investments) During the reporting period, the company completed two significant equity transactions: selling a 30.04% stake in Dermedicine and acquiring the remaining 30.23% minority interest in Taizhou Fudan-Zhangjiang - The company sold a **30.04%** equity interest in Dermedicine for **RMB 16.522 million**, reducing its shareholding to **20%** after the transaction, resulting in Dermedicine no longer being a subsidiary of the company[78](index=78&type=chunk) - The company acquired a **30.23%** minority equity interest in Taizhou Fudan-Zhangjiang for **RMB 178 million**, making Taizhou Fudan-Zhangjiang a wholly-owned subsidiary upon completion of the acquisition[79](index=79&type=chunk) [Liquidity and Financial Resources](index=25&type=section&id=Liquidity%20and%20Financial%20Resources) As of year-end 2019, the company maintained a robust financial position with approximately RMB 577 million in cash and cash equivalents, significantly exceeding its RMB 149 million loan balance, rendering the debt-to-equity ratio inapplicable - As of December 31, 2019, the Group's cash and cash equivalents amounted to approximately **RMB 577 million**[81](index=81&type=chunk) - As of December 31, 2019, the Group's outstanding loans totaled **RMB 149 million**, all of which were short-term credit borrowings[80](index=80&type=chunk) - The Group's debt-to-equity ratio is not applicable as its cash and cash equivalents significantly exceed its outstanding borrowings[82](index=82&type=chunk) [Other Matters and Post-Balance Sheet Events](index=26&type=section&id=Other%20Matters%20and%20Post-Balance%20Sheet%20Events) The company continued its A-share STAR Market issuance plan, submitting applications to the SSE; post-balance sheet events include the formal adoption of China Accounting Standards and related article amendments approved in February 2020 - The company plans to issue no more than **120 million** A-shares on the Shanghai Stock Exchange's STAR Market and received the SSE's acceptance notice on May 13, 2019[84](index=84&type=chunk)[85](index=85&type=chunk) - Post-balance sheet events: Approved at the February 2020 shareholders' meeting, the company's overseas financial reporting standards changed from International Financial Reporting Standards to China Accounting Standards, and the company's articles of association were revised accordingly[86](index=86&type=chunk)[87](index=87&type=chunk) [Board of Directors' Report](index=29&type=section&id=Board%20of%20Directors'%20Report) [Business Review and Risk Factors](index=29&type=section&id=Business%20Review%20and%20Risk%20Factors) The company primarily engages in innovative drug R&D and industrialization across four platforms, facing key risks including R&D uncertainty, market promotion challenges, drug price reduction, and evolving regulatory policies - The company primarily engages in innovative drug R&D and industrialization, with core products being Aile® and Fumedai® from the photodynamic platform, and Lipusu® from the nanotechnology platform[89](index=89&type=chunk) - Key risks include: R&D risks for innovative drugs (high investment, long cycle, high uncertainty), market launch risks for new drugs (uncertain market cultivation time), and drug price reduction risks[92](index=92&type=chunk) - Changes in industry regulatory policies are a major uncertainty, and the company will actively adapt to new policies to mitigate their impact[93](index=93&type=chunk) 2019 Major Customer and Supplier Concentration | Category | Percentage of Total | | :--- | :--- | | Largest customer | 11.00% | | Top five customers combined | 37.05% | | Largest supplier | 12.07% | | Top five suppliers combined | 38.40% | [Performance and Dividend Policy](index=31&type=section&id=Performance%20and%20Dividend%20Policy) The company implements a stable and proactive profit distribution policy, prioritizing cash dividends of no less than 10% of distributable profit; the Board recommends a final dividend of RMB 0.07 per share for 2019, totaling approximately RMB 64.61 million - The company prioritizes cash dividends, with an annual cash dividend ratio of no less than **10%** of the distributable profit for the year[95](index=95&type=chunk) - The Board recommends a final dividend of **RMB 0.07** per share (tax inclusive) for 2019, totaling approximately **RMB 64.61 million**[96](index=96&type=chunk) [Connected Transactions](index=39&type=section&id=Connected%20Transactions) During the reporting period, the company engaged in multiple ongoing and one-off connected transactions, primarily with major shareholder Shanghai Pharma, all within annual caps, and completed the acquisition of Taizhou Fudan-Zhangjiang's minority stake, with all transactions deemed fair - Ongoing connected transactions with Shanghai Pharma: In 2019, product sales to Shanghai Pharma totaled **RMB 78.235 million**, not exceeding the annual cap of **RMB 81 million**[113](index=113&type=chunk) - Ongoing connected transactions with Shanghai Jiaolian: In 2019, received **RMB 6.372 million** in cooperative research fees, not exceeding the annual cap of **RMB 7 million**[114](index=114&type=chunk) - One-off connected transaction: Completed the acquisition of a **30.23%** equity interest in Taizhou Fudan-Zhangjiang for a total consideration of **RMB 178 million**, making it a wholly-owned subsidiary[118](index=118&type=chunk) - One-off connected transaction: Approved the participation of several connected persons, including Mr. Wang Haibo, in the future A-share issuance strategic placement plan[119](index=119&type=chunk)[120](index=120&type=chunk) [Committee Reports](index=47&type=section&id=Committee%20Reports) [Supervisory Committee Report](index=47&type=section&id=Supervisory%20Committee%20Report) The Supervisory Committee oversaw the company's 2019 operations, confirming compliance by directors and management, finding no violations, and affirming the accuracy of financial statements and the validity of Board resolutions - The Supervisory Committee found no violations of national laws, regulations, and the Company's Articles of Association by directors and managers during 2019[128](index=128&type=chunk) - The Supervisory Committee believes the audit report is true and objective, and the financial statements accurately reflect the Group's financial position[128](index=128&type=chunk) [Audit Committee Report](index=48&type=section&id=Audit%20Committee%20Report) The Audit Committee oversaw financial reporting, risk management, and internal controls, reviewing financial statements and connected transactions, and approved changes in overseas auditors and the adoption of China Accounting Standards, recommending Board approval for the 2019 financial statements - The Audit Committee held four meetings in 2019, reviewing financial reports, connected transactions, internal control procedures, and auditor arrangements[130](index=130&type=chunk)[131](index=131&type=chunk) - The Committee reviewed and approved the company's arrangements for changing overseas auditors and adopting China Accounting Standards as the basis for overseas financial reporting[132](index=132&type=chunk) [Remuneration Committee Report](index=50&type=section&id=Remuneration%20Committee%20Report) The Remuneration Committee, composed of three independent non-executive directors, formulates and reviews remuneration policies for directors, supervisors, and senior management, reviewing 2018 and formulating 2019 plans - The Remuneration Committee is responsible for making recommendations to the Board on the overall remuneration policy and structure for the company's directors, supervisors, and senior management[133](index=133&type=chunk) - In 2019, the Remuneration Committee held one meeting, primarily to review the 2018 remuneration plan and formulate the 2019 remuneration plan[134](index=134&type=chunk) [Nomination Committee Report](index=52&type=section&id=Nomination%20Committee%20Report) The Nomination Committee reviews Board structure, assesses independent non-executive directors' independence, and recommends director appointments and succession plans, evaluating independence and monitoring diversity policy implementation in 2019 - The Nomination Committee is responsible for reviewing the Board's structure, size, and composition, and for making recommendations to the Board regarding director appointments or re-appointments[136](index=136&type=chunk) - In 2019, the Nomination Committee held one meeting, primarily to evaluate the independence of independent non-executive directors and monitor the implementation of the Board diversity policy[136](index=136&type=chunk) [Corporate Governance Report](index=53&type=section&id=Corporate%20Governance%20Report) [Board and Management](index=54&type=section&id=Board%20and%20Management) The company's Board comprises nine members, including three executive, two non-executive, and four independent non-executive directors; the Chairman and General Manager roles are combined, and all directors achieved 100% attendance at the six Board meetings in 2019 - The Board consists of **9** directors, including **3** executive directors, **2** non-executive directors, and **4** independent non-executive directors[141](index=141&type=chunk)[142](index=142&type=chunk) - The company deviates from the Corporate Governance Code as the Chairman and General Manager roles are still held by the same person, an arrangement the Board believes is more beneficial for the company's development at the current stage[140](index=140&type=chunk)[148](index=148&type=chunk) - In 2019, the Board held a total of **6** meetings, with all directors achieving **100%** attendance (in person or via communication)[151](index=151&type=chunk)[152](index=152&type=chunk) [Risk Management and Internal Control](index=64&type=section&id=Risk%20Management%20and%20Internal%20Control) The Board holds ultimate responsibility for the group's risk management and internal control systems, which were reviewed and deemed effective and adequate in 2019, with quarterly reporting by the Internal Audit and Control Department - The Board is responsible for assessing and determining the level of risk the Group is willing to accept in achieving its strategic objectives, and for ensuring the establishment and maintenance of effective risk management and internal control systems[164](index=164&type=chunk) - The company established an Internal Audit and Control Department, which reports key risk identifications and response measures to the Audit Committee quarterly, and the Board deemed the system effective and adequate in 2019[164](index=164&type=chunk) [Shareholder Rights and Investor Relations](index=71&type=section&id=Shareholder%20Rights%20and%20Investor%20Relations) The report outlines shareholders' rights and procedures for convening extraordinary general meetings; in 2019, the company held one annual general meeting, two extraordinary general meetings, and related class meetings, with all directors attending all five shareholder meetings - Shareholders holding **10%** or more of the voting shares in aggregate may request the Board to convene an extraordinary general meeting[181](index=181&type=chunk) - In 2019, a total of **1** annual general meeting, **2** extraordinary general meetings, and related class meetings were held, with all directors achieving **100%** attendance[185](index=185&type=chunk)[186](index=186&type=chunk)[189](index=189&type=chunk) [Environmental, Social and Governance Report](index=79&type=section&id=Environmental%2C%20Social%20and%20Governance%20Report) [ESG Governance and Operations](index=80&type=section&id=ESG%20Governance%20and%20Operations) The company established a three-tier ESG governance structure, adheres to GMP for quality control, innovates through its four technology platforms, complies with anti-corruption laws, and actively fulfills social responsibilities - A three-tier ESG management system, comprising the Board, management, and ESG working group, has been established, with the Board serving as the highest decision-making body[197](index=197&type=chunk) - The company has established a complete quality management system in accordance with GMP standards, covering the entire process from supplier audits, material release, and production to product recalls[208](index=208&type=chunk)[209](index=209&type=chunk) - The company strictly adheres to anti-corruption laws, provides compliance training to employees, and includes anti-commercial bribery clauses in agreements with distributors and suppliers[203](index=203&type=chunk)[205](index=205&type=chunk) [Employees and Environment](index=88&type=section&id=Employees%20and%20Environment) The company promotes a people-oriented culture, ensuring occupational health and safety with no work-related fatalities, and prohibits child and forced labor; environmentally, it complies with regulations, reduces pollution at source, and treats waste, with stable greenhouse gas emissions but decreased intensity - During the reporting period, no violations related to occupational health and safety occurred, nor were there any work-related injuries or fatalities among employees[222](index=222&type=chunk) - The company strictly adheres to labor standards, prohibits child or forced labor, and verifies compliance through measures such as ID checks upon employment[237](index=237&type=chunk) 2018-2019 Greenhouse Gas Emissions | Greenhouse Gas Indicator | 2019 | 2018 | | :--- | :--- | :--- | | Total emissions (tonnes of CO2 equivalent) | 8,437.77 | 8,426.80 | | Emission intensity (tonnes per million RMB sales revenue) | 8.20 | 11.36 | 2018-2019 Energy and Water Consumption | Resource Consumption Indicator | 2019 | 2018 | | :--- | :--- | :--- | | Total energy consumption (MWh) | 14,941.18 | 14,883.00 | | Energy consumption intensity (MWh per million RMB sales revenue) | 14.52 | 20.06 | | Total water consumption (tonnes) | 94,727.00 | 82,137.00 | | Water consumption intensity (tonnes per million RMB sales revenue) | 92.03 | 110.72 | [Biographies of Directors, Supervisors and Senior Management](index=99&type=section&id=Biographies%20of%20Directors%2C%20Supervisors%20and%20Senior%20Management) This section provides detailed personal biographies of the company's executive, non-executive, and independent non-executive directors, supervisors, and senior management, including their professional backgrounds - Mr. Wang Haibo, 59, is the company's founder, executive director, chairman of the Board, and general manager[253](index=253&type=chunk) - Ms. Xue Yan, 38, serves as the company secretary, chief financial officer, and authorized representative[262](index=262&type=chunk) [Independent Auditor's Report](index=104&type=section&id=Independent%20Auditor's%20Report) PwC Zhongtian Certified Public Accountants issued an unqualified audit opinion on the company's 2019 financial statements, deeming them to fairly reflect the financial position and operating results; the key audit matter, 'capitalization of development expenditures,' was found to be sufficiently supported - The auditor believes that the financial statements have been prepared in all material respects in accordance with the provisions of the Accounting Standards for Business Enterprises, and fairly reflect the company's financial position as of December 31, 2019, and its operating results and cash flows for the year ended 2019[265](index=265&type=chunk) - The key audit matter identified in the audit was "capitalization of development expenditures"; the auditor concluded that management's judgment was supported by examining government approval documents, evaluating technical feasibility judgments, and the reasonableness of future economic benefit assumptions[266](index=266&type=chunk)[267](index=267&type=chunk) [Financial Statements and Notes](index=109&type=section&id=Financial%20Statements%20and%20Notes) This section provides detailed consolidated and company-level financial statements and notes, explaining accounting policies, estimates, and item breakdowns; key data shows total assets grew to RMB 1.565 billion and net cash flow from operating activities was RMB 269 million [Summary of Consolidated Financial Statements](index=109&type=section&id=Summary%20of%20Consolidated%20Financial%20Statements) As of year-end 2019, the company's total assets were RMB 1.565 billion, total liabilities RMB 632 million, and equity attributable to parent company shareholders RMB 932 million, with full-year operating revenue of RMB 1.029 billion and net profit of RMB 221 million Consolidated Balance Sheet Summary (December 31, 2019) | Item | Amount (RMB) | | :--- | :--- | | Total current assets | 1,138,239,344 | | Total non-current assets | 426,585,209 | | **Total Assets** | **1,564,824,553** | | Total current liabilities | 571,349,539 | | Total non-current liabilities | 60,326,900 | | **Total Liabilities** | **631,676,439** | | Total equity attributable to company shareholders | 931,525,379 | | **Total Shareholders' Equity** | **933,148,114** | Consolidated Income Statement Summary (2019) | Item | Amount (RMB) | | :--- | :--- | | Operating revenue | 1,029,294,769 | | Operating profit | 247,481,515 | | Total profit | 246,311,582 | | **Net Profit** | **220,654,095** | | Net profit attributable to company shareholders | 227,357,983 | Consolidated Cash Flow Statement Summary (2019) | Item | Amount (RMB) | | :--- | :--- | | Net cash flow from operating activities | 269,232,612 | | Net cash flow used in investing activities | (21,141,701) | | Net cash flow used in financing activities | (259,569,098) | | **Net decrease in cash** | **(11,422,006)** | | Cash balance at year-end | 576,799,410 | [Summary of Notes to Financial Statements](index=122&type=section&id=Summary%20of%20Notes%20to%20Financial%20Statements) The notes detail changes in accounting policies, particularly the impact of new lease standards, and revenue recognition; related party transactions primarily involve sales and R&D with Shanghai Pharma Group; capital expenditure commitments totaled approximately RMB 1.26 million at year-end, with no significant contingent liabilities or major adverse post-balance sheet impacts from COVID-19 - The company first adopted the new lease standards on January 1, 2019, adjusting the opening balance sheet by recognizing right-of-use assets of **RMB 37.52 million** and lease liabilities of **RMB 39.87 million**[377](index=377&type=chunk)[378](index=378&type=chunk)[379](index=379&type=chunk) - In 2019, the company engaged in sales transactions with related parties, Shanghai Pharma Group and its subsidiaries, totaling approximately **RMB 61.49 million**[517](index=517&type=chunk) - As of the end of 2019, the company's contracted but unlisted capital expenditure commitments (primarily for property, plant, and equipment) amounted to **RMB 1,260,346**[534](index=534&type=chunk) - Post-balance sheet events mention that the COVID-19 pandemic, which erupted in January 2020, is expected to have a temporary impact on the Group's production and operations, but no significant adverse effects have been identified as of the report date[535](index=535&type=chunk)

上海復旦張江生物醫藥股份有限公司 Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co., Ltd. * (Stock Code: 1349) (a joint stock company incorporated in the People's Republic of China with limited liability) INTERIM REPORT 2019 中期報告 INTERIM REPORT For the six months ended 30 June 2019 上海復旦張江生物醫藥股份有限公司 Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co., Ltd. * （股票號碼：1349） （於中華人民共和國註冊成立的股份有限公司） 截至二零一九年六月三十日止六個月 中期報告 * 僅供識別 * For identification purpose only 五年財務摘要 業績 未經醫核 | --- | --- | --- | --- | --- | --- | |---------------------- ...

* (a joint stock company incorporated in the People's Republic of China with limited liability) (Stock code: 1349) Annual Report Annual Report 2018 年報 For identification purpose only * (於中華人民共和國註冊成立的股份有限公司) (股票號碼：1349) 2018 2018 年 報 * * * 僅供識別 目 錄 | --- | --- | --- | --- | --- | --- | --- | --- | |-------|----------------------------|-------|-------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 公司資料 公 | | | | | | 2 | | | 五年財務摘要 | | | | | | 4 | | | 主席報告 | | | | | ...